The treatment of vertical agreements in EC competition law has changed Essay - 1

The treatment of vertical agreements in EC competition law has changed significantly during the last ten years - Essay Example n years, it is necessary to explain of Article 81 EC, the requirements for the exemption under Article 81(3) and under Commission Regulation 2790/99 on vertical restraints and considering old regulations and relevant case law1. Article 81 regulates anti-competitive behaviour in a wide range of scenarios and has been applied with reference to what the EU is trying to achieve: a level playing field2 for competition within an internal market. The aim of achieving market integration between the Member States is apparent in many rulings of the Commission and European courts. Article 81(1) provides that â€Å"all agreements between undertakings, decisions by associations of undertakings and concerted practices and which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market shall be prohibited. In Article 81(3) the conditions for exemption from Article 81(1) are laid down. The way in which the ECJ has interpreted these concepts and requirements will be examined in the following subsection. According to the (C-41/90 Hofner and Elser3), the meaning of undertakings is ‘The concept of undertaking encompasses every entity engaged in an economic activity regardless of the legal status of the entity and the way in which it is financed’. This means that any entity carrying on a commercial or economic activity (company, partnership, sole trader, co-operative) is subject to the competition rules, including individual professionals, non-profit- making services, public utilities, and even public authorities when they are acting commercially, but not when exercising their official authority [Case 30/87 Corinne Bodson v Pompes Funà ¨bres des Regions Libà ©rà ©es4]. Under Article 81, there is first a finding of infringement under Article 81(1). The weighing of the pro- and anti-competitive effects of an agreement only takes place under Article 81(3) which allows exemption for